Stocks surge, oil drops as Russia claims retreat from Ukraine border

Global stock markets surged Tuesday after Russia’s Defense Ministry claimed some of its troops are retreating from the Ukrainian border following military drills and returning to base. Dow futures jumped more than 300 points Tuesday morning on the news a day after markets flinched at the possibility of war. Commodities — which have been rising amid tensions — also fell, with crude oil dropping about 3% from Monday.

While the economy celebrated de-escalation, NATO Secretary General Jens Stoltenberg expressed “cautious optimism,” noting the group had not yet seen any evidence Russia is in fact withdrawing pressure. However, Russian President Vladimir Putin said that Moscow is ready to engage in security talks with the U.S. and NATO.

“There are signs from Moscow that diplomacy should continue,” Stoltenberg said ahead of meetings with NATO defense ministers Wednesday.

Meanwhile, the White House is still bracing for what war could do to oil prices if an invasion occurs. A Biden administration spokeswoman said it’s working with other oil producers around the world to surge output if sanctions on Russia cramp supply.

If tensions increase between Russia and Ukraine, analysts have warned oil could go well past $100 per barrel. As of Tuesday, it was trading around $92 per barrel and national gas prices are at an 8-year high of $3.50 per gallon.